Diamondback Energy, Five Point Energy form Deep Blue Midland Basin LLC

Diamondback Energy and Five Point Energy announced the formation of a new joint venture entity, Deep Blue Midland Basin. This strategic joint venture creates the largest independent water infrastructure platform in the Midland Basin with substantial excess capacity in place to pursue third-party growth. As part of the transaction, Diamondback entered into a 15-year dedication for its produced water and supply water within a 12-county area of mutual interest in the Midland Basin. Diamondback will retain a 30% equity interest in Deep Blue and received approximately $500 million in upfront cash proceeds, with potential for more cash proceeds through performance-based earnouts over the next 24 months. Additionally, Five Point and Diamondback anticipate collectively contributing $500 million in follow-on equity capital to fund future growth projects and acquisitions. In conjunction with closing the joint venture, Deep Blue also executed long-term acreage dedications with two investment-grade customers, totaling over 20,000 acres with expected produced water volumes of over 75,000 barrels per day during 2024.